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Absolute Return Funds are Funds seeking to have +ve returns over a 2-to-3-year period. They could provide different returns profiles, low volatility and alleviate market drawdowns.

The ABS Funds seek +ve returns over a time period which is longer than 12 months and could be up to 36 months or even greater. Typically, the time period will be defined as a rolling period. The longer the period the more likely to achieve +ve returns. The diving investment philosophy or concern of an Absolute Return Strategy is what are the events or factors that could disrupt the financial markets. If identified correctly, they will seek to mitigate against potential losses. From the outset, the ABS funds allocate across a variety of different asset classes, equities, fixed income, maybe commodities (Gold) and Real Estate funds.

Typically, ABS will aim to have low correlations across the asset classes and also between the individual securities within an asset class. For example, ABS could invest in Equity Sectors or Stocks that have low correlations or different levels of volatility or High and Low Betas. The performance of these Funds is not measured against a Benchmark Index in fixed income or equities. Funds may be benchmarked against cash +. These strategies differ from relative return strategies which are specifically linked to the returns of an asset class.


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Warren William

Meet the author behind Smartest-Data. Warren William has a career in Finance and Investments extending over 35 years, both on the Buy Side and Sell Side. His most recent roles include, developing Institutional Risk Management Programs for managing Equity and Fixed Income Risk.  Prior to this Warren William work in Alternative Investments, in Investment Management and as a Buy Side Equity Analyst. Warren William brings a wealth of knowledge and expertise to the table, providing in-depth analysis and commentary on the latest trends in the Stock Markets. Contact information: or Telegram +393339034488

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